Elia Group soars 17% on €2.2 billion equity package, solid full-year results

Investing.com -- Shares in Elia Group (EBR:ELI) surged more than 17% in Brussels on Friday after the Belgian electricity system operator announced a €2.2 billion equity package, published solid fiscal 2024 (FY24) results and provided 2025 guide ahead of company-complied consensus.

Elia said it has agreed to raise €850 million through a private placement with investors including Atlas (NYSE:ATCO) Infrastructure, The Future Fund, BlackRock (NYSE:BLK), CPP Investments, and Publi-T. The company plans to follow this with a €1.35 billion rights issue after the completion of the private placement.

The private placement was priced at €61.88 per share, matching the 30-day average with no discount.

The company has also secured commitments for 55% of the €1.35 billion rights issue, which Barclays (LON:BARC) analysts believe “substantially de-risks the transaction.”

After the transaction, Elia expects to have €3.8 billion in net hybrid capacity and the flexibility to bring in minority owners at the Opco level as potential options to address residual funding needs for the 2024-2028 regulatory period.

“We see today’s capital raise update as positive, given the higher-than-expected amount, de-risked transaction profile and alternative options to meet Elia’s future capital needs which should address continuing overhang risk,” Barclays analysts led by Temitope Sulaiman added.

As for its FY24 results, Elia reported a net profit to ordinary shareholders of €421 million, 12% above consensus of €376 million.

Adjusted EBIT reached €912 million, exceeding expectations by 6%. The outperformance was driven by strong results in the German business and lower-than-expected losses in Nemolink and non-regulated segments.

ETB net profit slightly beat forecasts at €214 million, while 50Hertz (100%) delivered €308 million, 11% higher than the consensus projection, benefiting from improved operational performance.

For 2025, Elia reaffirmed its net profit guidance of €490-€540 million, with the mid-point 14% above consensus estimates.

Barclays analysts said they see today’s outperformance in Elia shares compared to the broader market “as justified.”